A horticulture provider has been issued a total penalty of $617,916 – the highest in Australian history for breaches of labour hire law – following a Labour Hire Authority (LHA) prosecution in the Supreme Court of Victoria.
A L Star Express Pty Ltd was found to have knowingly contravened the Labour Hire Licensing Act 2018 (Vic) by repeatedly providing workers without holding a labour hire licence.
The company supplied the workers through an intermediary to three separate businesses, and directly to another business, to perform horticulture work in regions including Rosebud, Koo Wee Rup, Torquay and Devon Meadows.
The Court issued penalties for each of the four contraventions of the Act, and considered the conduct as a whole, to award the significant total penalty.
In its judgment, the Court noted that the contraventions “must be characterised as serious”, and that the penalty “needs to be sufficiently high not to be the ‘price of doing business’”.
Labour Hire Licensing Commissioner, Steve Dargavel, said the judgment showed the importance of labour hire licensing, and the significant potential penalties for non-compliance with the Act.
“This judgment highlights that all labour hire companies must be licensed – we will hold companies to account if they knowingly contravene that fundamental requirement of the Act,” he said.
“Licensing is the foundation on which we’re working to build an industry that’s fairer for workers, and for the many businesses that do the right thing,” said Commissioner Dargavel.
“To hold a licence, labour hire companies undergo a range of checks – of the business and the people running it – to guard against issues that have historically been rife in the industry,” he said.
As well as prosecuting alleged contraventions of the Act, LHA can remove a provider's ability to operate in Victoria by refusing, suspending, or cancelling their licence.
The horticulture industry has been a focus of LHA compliance and enforcement, and of Victoria-wide engagement activities, across 2023 – part of an expanded program of activity also targeting the security, meat and poultry processing, and commercial cleaning industries.
Related stories this month
Licensing obligations in complex supply chains
In its judgement, the Supreme Court of Victoria noted that licensing obligations could not be avoided by supplying workers through an intermediary business.
Under the Act, labour hire providers who on-supply workers from other labour hire businesses must ensure they are licensed, and that they only enter arrangements with other licensed providers where they subcontract.
“Any business attempting to hide unlawful behaviour through subcontracting is on notice – you cannot avoid your legal obligations by providing or sourcing workers through an intermediary,” Commissioner Dargavel said.
“The same significant penalties apply whether you engage another company to provide unlicensed labour hire services or provide those services yourself, so always check the LHA website to ensure your provider is licensed,” he said.
The risk of non-compliance is heightened as labour supply chains increase in complexity. LHA encourages all hosts and providers to retain an appropriate level of oversight and responsibility throughout their labour supply chains.
One of the most important things that all businesses can do to ensure compliance is confirm they are entering into contractual arrangements that reasonably allow providers to comply with their minimum legal obligations.
Providers and hosts should use LHA’s tools to ensure they only use licensed providers: